you simply cut out/prepare your appliques- place them onto the background square/strip-what ever they go on- put together your quilt sandwich (backing/batting/top) baste- then quilt as you stitch your appliques into place- can be done by machine or by hand which ever you prefer-
if by machine you can use fusable (it is often difficult to stitch through by hand) - fuse the appliques into place- make your sandwich and stitch your appliques down- which quilts your piece at the same time.